Analysts at Citi have revised their Bitcoin valuation model, incorporating updated market variables. According to the new forecast, the base case projects BTC reaching $135,000 by the end of 2025. In an optimistic scenario, the price could climb as high as $199,000, while a bearish turn could see it drop to $64,000.
What Has Changed in the Model
The bank’s updated model is built around three key factors:
- User activity.
- Macroeconomic conditions.
- Demand for spot ETFs.
At the core of the model is audience growth and network effects. Citi increased its user forecast by 20%, which alone pushes the expected price up to $75,000.
Macroeconomic conditions, however, subtract around $3.2K from the target price due to pressure from sluggish equity and gold markets. Meanwhile, ETF flows could add about $63K if the market sees an additional $15 bln in inflows. These adjustments shape the base-case scenario of $135,000 by December.
ETF Flows Drive Volatility
According to Citi, since the approval of U.S. spot ETFs in January 2024, these funds have accounted for more than 40% of BTC price movements. Institutional investments have become a dominant market driver and are directly influencing forecasts.
Analysts emphasize that ETF influence is growing faster than anticipated. Capital inflows through ETFs are accelerating, and user activity remains strong - contrary to earlier expectations. This strengthens the network effect and adds price stability.
Macroeconomic Signals Are Outpacing Technology
The report highlights a shift in market fundamentals: whereas previous cycles were driven by technology adoption, capital allocation has now taken the lead. Traditional financial channels - index inclusion, ETFs, institutional decisions - are influencing price behavior just as much as, if not more than, user growth.
Earlier, CryptoQuant CEO Ki Young Ju admitted a flaw in his previous strategy. He acknowledged that the old model, buying when whales accumulate and selling when retail joins, no longer applies.
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